Wednesday, 30 April 2014

A number of commentators have focused on the role of Russia in the crisis in eastern Ukraine. However, that the actions of the West and the interim Ukrainian government have also significantly contributed to the crisis.

The regional cleavage in Ukraine is not a myth, as many analysts still insist. It is clearly reflected in surveys on the support for the Euromaidan at the beginning of the protests, but also on its end, on the interim government’s legitimacy, integration into NATO, and finally on association with the EU, if that would mean moving apart from Russia. On all these issues regional disparity reaches 40-50 per cent. Consequently, those of us who have been warning against the centrifugal effects that the revolution in Kiev would produce are neither surprised by the rebellion in eastern Ukraine, nor willing to understand it as just the result of a conflict with external powers.

However, this crisis is not a by-product of the complex historical process of Ukrainian state-building either; decisions by the main actors (internal and external) in this crisis have been equally relevant. Yanukovych, the EU and Russia have an undeniable responsibility for the crisis, but the current situation of ‘multiple sovereignty’ has been caused by three key elements: the interim government’s decisions, which have contributed to the social polarisation of the country; the opening of a political opportunity structure for the pro-Russian rebels in the East after Crimea was annexed by Russia; and the state’s weakness, which makes it very difficult to neutralise the challenge posed by armed groups.

Among the failures in the interim government’s decisions, there are two ‘original sins’ and three later mistakes that were also far from inconsequential. First, the opposition leaders broke the February 21st agreement that was negotiated with mediators from the EU and Russia, immediately taking power once the president fled to the East of the country. Second, instead of the ‘national unity’ interim government they had agreed to, they appointed a new cabinet which excluded the regions that did not support them, as had happened under Yanukovych.

Three other decisions were also misguided, even considering the difficult situation after Crimea’s illegal and illegitimate annexation. The law recognising Russian as a co-official language in the regions where it is used by the majority was abolished, although it was later reinstated. Second, two oligarchs and former ‘Orange’ supporters became regional governors of Dnipropetrovsk and Donetsk. This angered eastern citizens, already fed up with the excessive influence of local businessmen in politics; and also worried those oligarchs affiliated with the Party of Regions.

Moreover, Kiev signed the political part of its Association Agreement with the EU, as well as the bailout deal with the IMF, without considering widespread fears among entrepreneurs and the working class about the negative effects for industrial and mining sectors. In addition to eastern and southern Ukrainians’ feelings of being excluded from central institutions, four factors related to Crimea provided them with a political opportunity to defy the new authorities:

First, they perceived that Kiev and the West on one side, and Russia on the other, had implicitly agreed to exchange the peninsula for control over the rest of Ukraine. Second, the new strategy used in Crimea (small armed groups seizing government buildings) showed that mass demonstrations incorporating tens of thousands of protesters were unnecessary. Third, Kiev’s authority appeared notably weak and the security forces looked deeply divided. Finally, the new electorate, without Crimean voters, has made it almost impossible for the Russian-speaking regions to win another presidential election in the future. Therefore, any such movement needed to take place before the planned 25 May election: for the rebels, it was now or never.

Failure by the state to effectively respond to a direct threat to its sovereignty has become evident in the disloyal behaviour of the local bureaucracy, army and law enforcement officers, many of which have refused to follow orders from Kiev or even defected to the rebels. Disaffection for the central government and regional polarisation should be measured by this lack of mobilisation against the separatist challenge, not by the mobilisation of a limited number of pro-Russian protesters.

Meanwhile the United States and the EU are pursuing three partially incompatible objectives: keeping the pro-Western interim government in power, preventing a war, and countering Russia’s own strategy. The West is also paying for its own ‘original sin’ in accepting the opposition’s unilateral takeover, in breach of the 21 February agreement, as an opportunity to consolidate a pro-European (and pro-trade liberalisation) course.

Neither Washington nor Brussels demanded that the Russian language’s status was not changed, protested against the appointment of Svoboda’s xenophobic nationalists to top government positions, or advised that the new cabinet should include representatives of the eastern regions (which had overwhelmingly voted for Yanukovych, a native of the Donetsk oblast himself).

The 17 April Geneva Declaration was only aimed at de-escalation on the ground; no agreement was made on a long-term solution, apart from a “broad national dialogue” on constitutional reform. Kiev has agreed to grant a certain level of autonomy to the regions, but opposes a federal system because that could also facilitate Russian influence. However, after the Maidan ousted Yanukovych and Crimea’s annexation made it very unlikely for any eastern candidate to become president, a highly decentralised state is the only way to reassure the Russian-speaking regions.

Another disagreement concerns the rebels’ refusal to disarm: they argue that the interim government is illegitimate, armed groups on the opposite side (like the fascist movement Right Sector) have not been disbanded, and that central Kiev is still occupied by protesters after the revolution. The interim government has been taking steps such as removing barricades from the Maidan or distancing themselves from Right Sector, which is becoming a dangerous threat to their own authority.

Finally, Kiev’s propaganda (repeated by some Western media) has identified the rebels as equivalent to the incognito Russian soldiers that occupied Crimea; however, it has been proven that they are a diverse group including local pro-Russian nationalists, war veterans, former Berkut riot police officers, and volunteer fighters from other post-Soviet states (including Cossacks). No doubt Moscow is helping them through intelligence agents on the ground, as well as facilitating travel to Ukraine by ‘war tourists’. However, it is clear that the militias enjoy a considerable amount of local support and most of their members are Ukrainian citizens.

Three main scenarios could develop in the short term. The first is a civil war, to which the government and the militias unfortunately seem to be edging closer toward after several incidents left victims on both sides. However, as Kiev’s previous attempted military operation showed, soldiers might refuse to fire against the civilians that are shielding the rebel fighters. Regaining control over these regions by force would cost many human lives. On the other hand, the expected response by the overwhelmingly superior Russian army could deter Kyiv from launching a full-scale attack, unless they had no other political option and counted on Western (probably indirect) military assistance.

The second scenario would involve Russia’s occupation of the East, which (unlike ethnic Russians in Crimea) many Russian-speaking Ukrainians would not welcome. Putin seems more cautious in this case; he probably realises the negative impact of Crimea’s annexation for his own country. However, the militias seem to hope that Moscow will send troops if they suffer enough casualties, which obviously creates a perverse incentive. Such an intervention would probably secure those territories while negotiating their future status; but organising a separatist referendum would be problematic, considering that many locals want to remain part of (a decentralised) Ukraine. If dialogue failed, this would become another ‘frozen conflict’ like South Ossetia or Abkhazia before 2008.

While the West and Russia do not want to back off, they are not really willing to risk an escalation either. Aside from gestures such as Washington or Moscow's military deployments, war would be the worst scenario: it would destabilise the whole region, send thousands of refugees to the EU and Russia, and greatly damage their economic interests.

Eastern Ukrainian oligarchs, for the same reasons, want concessions from Kiev but will also use all their influence to prevent an armed confrontation. An agreement seems to be the only rational option, although at this point many Ukrainians on both sides are driven by nationalist feelings rather than cost-benefit calculations.

By Guylain Gustave Moke
Political Analyst/Writer
Investigative Journalist/Author
Researcher at De Montfort University-England

Photo-Credit: Reuters-Photo-Pro-Russian armed men gather at the entrance to the regional government headquarters in Luhansk, eastern Ukraine, April 30, 2014.

Wednesday, 23 April 2014

For decades most sub-Saharan African countries have been unattractive destinations for foreign investment because of perceived high risks of violence, instability and weak governance.

A report from the United Nations Conference on Trade and Development (UNCTAD) in 2009 showed that Africa`s inward foreign direct investment (FDI) stock in agriculture represented only seven per cent of the total stock in developing countries. But the situation is starting to change for two reasons:

The first is that food production is being outpaced by rapid population growth and increasing per capita incomes. If current demographic and agricultural output trends persist, sub-Saharan Africa would depend on imports to guarantee 77 per cent of its two billion population's food needs by 2050.

The second reason is that food importing countries and foreign investors are turning to Africa for alternative sources of supply and growth opportunities. Since the 2008 financial crisis and the subsequent hike in food prices, food security has become a major global concern and demand for fertile soil has increased substantially. Foreign investors are also attracted by the low cost of local inputs and prospects of high returns.

Higher global food prices combined with increasing internal and international demand is expected to make Africa`s agriculture more profitable. Governments, companies and investment funds are now competing for African land. The World Bank has recently estimated that Africa`s food system could become a US$1 trillion market in 15 years.

Since 2012, private investment and official development assistance (ODA) towards Africa`s agriculture have been increasing. A number of initiatives are under way. Brazil and India have set up south – south cooperation models with their African counterparts.

Another initiative is the New Alliance for Food Security and Nutrition, a joint partnership between African governments, G8 countries - the leading industrialised economies in the world - and the private sector.

The goal of the alliance is to transform the nature of agriculture and food production in a number of world regions, including sub-Saharan Africa. Twelve African countries, including Ethiopia and Malawi, have joined the initiative, and pledged to improve investment opportunities by easing export controls and tax laws.

Seventy private foreign companies, including the Swiss food multinational, Nestle, the Norwegian fertiliser company, Yara, the Swiss agribusiness company, Syngenta, and the Anglo-Dutch multinational, Unilever, have committed to invest a total of US$3 billion in the agricultural sector. Donor states have pledged to guarantee that cooperation frameworks are established to coincide with national food security plans.

Countries which have their own food security concerns are buying or leasing land to produce cash crops that are exported to their countries. These deals usually result in the adoption of large-scale and capital-intensive production systems under the investor`s direct control.

China is looking at investment in Africa because land, water and rural labour constraints are expected to reduce agricultural output in the next decade, according to the OECD-FAO (Organisation for Economic Cooperation and Development – Food and Agricultural Organisation of the UN) outlook 2013-2022. Saudi Arabia and South Korea also have concerns over food supplies and agricultural commodities.

In the best case scenario, investments, when aligned with a country’s agricultural and food security plans, could bring substantial benefits for local populations, including employment, the development of research and innovation centres to attract rural youth, and the connection of farmers to markets.

But while African countries need foreign investment to fill the finance gap for agriculture and unlock the sector`s potential, there is concern that if future investment is not adapted to local realities and needs, and not in line with the priorities of individual governments, the competition for land could prove disastrous for Africa`s agriculture and compromise food security in the region.

In Madagascar, Mozambique or Tanzania there have been popular protests against land deals. Leasing or buying land in overpopulated areas or in regions where agriculture represents a major source of livelihood, may lead to a worst case scenario where food security, social cohesion and political stability are compromised.

Tuesday, 22 April 2014

The phenomenon we have been witnessing for some time now looks more and more like an industrial revolution overturned. Vast masses of migrants converge on the city, in the anonymous constellations of shopping centres in the suburbs, between the intersections of the major routes of communication (motorways, railways, airports), but also in the degraded historical centres.

They come not only from neighbouring countries or from the developing ones, but also from within the same country: they leave the countryside, the villages and small towns where there is no work to be found and seek refuge in the big cities, in the hope of finding new opportunities to enable them to start over. It estimated that by 2030 over 27 billion people will have migrated from their country of origin to settle elsewhere, thus helping to fuel the social differences within the same country.

In the cities it is easier to find food, sustenance, some sort of makeshift accommodation, and a minimum of solidarity that naturally arises amongst those who share the same fate. Two migratory flows from the inside and from the outside, two different backgrounds settling in the same places and with the same basic motivations in common: to change in order to survive. Driven by the desire for liberation from need, by the hope for improvement, but as a result of their voluntary transfer, both end up becoming social outcasts.

People who, in their own community, had an identity, led a dignified existence, albeit poor, and who were recognised and respected, suddenly find themselves stripped of their humanity, made ​​anonymous and viewed with suspicion, distrust, and, at best, with compassion. Marginalisation is the price to pay for a choice that has become necessary.

In contrast to the urbanisation of the industrial revolution of the eighteenth century, migration to the big cities today is not a choice made out of the need to find work, but out of desperation. Industrial centres used to be hungry for a general labour force: now there is no call for it, there are no offers of work or, if there are, they mainly for highly skilled workers. Those who arrive without any financial resources and marketable skills have to adapt to a disadvantaged state of poverty.

The cities now take on the function of shelters offering basic necessities to those who no longer have anything to lose; real lifelines in the desert created by globalisation, by the economic crisis, by profound changes that disrupt the social order and exacerbate differences, opening chasms of inequality which are unprecedented in human history.

The alarm comes mainly from Africa and Asia.Populated centres like Mumbai, Nairobi and Kinshasa are actually small towns surrounded by vast slums – “pockets of wealth in a sea of ​​despair” – where a growing number of people amass in search of hope. This trend is not limited only to those cities, but is more closely concerned with the world metropolises, without sparing New York, Tokyo, London, Paris or Rome, and no longer making any distinction between internal and external migration.

There is no integration because there is no work. The outcasts of industrialised society were tolerated because they represented a labour reserve ready to use when the need arose. Now, in the post-industrial society, there is no longer the need for an extra labour force; if anything, the problem is how to get rid of an excess of workers and replace them with numerical control machines which are becoming more and more sophisticated.

Globalisation is a process of desertification that burns the ground on which it passes, and wipes out any anthropological traces. For now, and as long as there are potential differences between different nations – not yet globalised – the multinationals will continue to relocate and move elsewhere in search of tax benefits, moderate regulations and lower costs.

But when the planet is entirely levelled, a reversal will take place: something like that is already happening in the USA. François Lenglet is certain of this (La Fin de la Mondialisation, Fayard, 2013): the phenomenon is still sporadic and limited, but it is an indicator of a turnaround. This, however, does not mean that globalisation is finished or has failed, but simply that it is completing its task. A planet that is uniform and perfectly undifferentiated, where the goal of equality can be reached, at least from certain points of view.

Cities, therefore, represent the last stand for uniformity, a sort of “Fort Apache” where people fight so as not to succumb, a safe place where there is still a guarantee of difference, where tradition is cultivated, where the idea of ​​community is transferred, with all the difficulties that this move entails, and where all these diversities are allowed to coexist, concentrated into a very limited space, with reciprocal respect.

Their walls are of stone and have no doors or drawbridges, but multi-coloured belts of refugees, migrants and marginalised people who surround them in ever-widening circles and make them into megalopolises built on destitution and despair and comfort. This will be the face of the great cities of tomorrow: places for wounded humanity to stop off, in anticipation of returning to the path of hope.

Friday, 18 April 2014

China, Asia's economic superpower, is hungry for natural resources, energy, food and markets for its products. Africa can offer all of these things: about 40 percent of global reserves of natural resources, 60 percent of uncultivated agricultural land, a billion people with rising purchasing power and a potential army of low-wage workers.

For years, China has engaged in an intensive campaign of visiting the continent. Presidents, heads of the government and ministers have traveled to almost all sub-Saharan countries that support China's policies and do not recognize Taiwan. They have forgiven debt, granted billions in loans, sealed defense deals and handed out generous aid packages. Most of all, however, they have secured access to Africa's natural resources.

China's economic offensive in Africa precisely began before the turn of the millennium. At first, it was very gradual and inconspicuous. But, since 2000, trade volumes between China and Africa have grown twentyfold, reaching $200 billion in 2012. China has surged ahead of the old major powers - France, the United Kingdom and the United States -- to become Africa's most important trading partner. Chinese companies have pumped billions into Africa to secure access to natural resources, boosting countries' economies along the way. Ordinary citizens aren't reaping the benefits, though, and have become increasingly wary of the new investors.

Tanzania is one of the focal points of the Chinese globalization strategy in Africa. In 2011, a large Chinese company invested $3 billion in coal and iron ore mines in the country. The enormous natural gas reserves off the Tanzanian coast -- an estimated 40 trillion cubic feet, allegedly more than in the Netherlands -- are of strategic interest. The China National Petroleum Company is currently installing a 532-kilometer (333-mile) pipeline from Mtwara, a port city in southeastern Tanzania, to Dar es Salaam. Despite Tanzania's economic growth rate of about 7 percent in 2012, the majority of the 45 million Tanzanians haven't benefited much from the upturn. On the contrary, the gap between rich and poor has only grown wider.
China's "irruption onto the African scene has been the most dramatic and important factor in the external relations of the continent -- perhaps in the development of Africa as a whole -- since the end of the Cold War.

There are now more than 2,000 Chinese companies and well over a million Chinese citizens in sub-Saharan Africa. They can be encountered in the major cities, in mining centers and oil fields, on plantations and even in the most remote jungle villages. They include managers and military advisers, doctors and agronomists, engineers and importers, itinerant traders, small business owners and contract workers employed on countless construction sites.

The Chinese are building conspicuous signs of their presence everywhere: presidential palaces, ministries, military barracks, conference centers, museums, stadiums, broadcasting companies, hotel complexes and large-scale agricultural operations. They are renovating railroad lines, paving thousands of kilometers of roads and building airports, dams, power plants and hospitals. Indeed, the Chinese are modernizing a large segment of the continent's infrastructure.

The Washington-based Center for Global Development estimates that, between 2000 and 2011, China provided about €75 billion in aid to Africa for a total of 1,673 projects, or roughly as much as the United States did in the same period. However, it is sometimes hard to tell where profitable investment ends and altruistic initiatives begin.

The competition from the West is often left empty-handed. Chinese state-owned companies operate with less bureaucracy, are faster and cheaper and, as a rule, provide financing for projects with low-interest loans from state-owned banks. In return for developing the infrastructure, the Chinese receive lucrative licenses to exploit natural resources and fossil fuels. For instance, Angola, a war-torn and marginalized country until not too long ago, has become one of China's key oil suppliers, competing with Saudi Arabia for the top position.

The concept of "West is best" is now a thing of the past. Disappointed by Europe and America, where their continent has often been written off as a hopeless case, Africans have instead looked to the Far East. There, they have found a strong ally, one that is mainly interested in doing business and doesn't interfere in their internal affairs. China attaches no political conditions to economic cooperation, unlike the West, which, at least on paper, demands good governance, the rule of law, anti-corruption measures and protections for human rights.

This is one of the reasons that despots like Zimbabwean President Robert Mugabe hold the Chinese in such high regard. Cooperating with China fills their empty coffers and enables them to secure their hold on power. And Africa's dictators are not badgered when they oppress and prey on their own people.

For example, Beijing wasn't overly troubled when the regime in Sudan waged a criminal war of forced displacement in Darfur. It continued to supply the Sudanese government with weapons and blocked resolutions in the United Nations Security Council. Beijing's primary concern was that Sudanese oil would continue to flow. Next to Angola, Sudan is China's second-most important source of oil in Africa.

With Chinese economic dominance, the West's political influence is gradually being eroded. In authoritarian countries like Ethiopia, Rwanda and Uganda, the model of the Chinese development dictatorship, which prioritizes growth over freedom, has long been a welcome alternative to liberal democracy.

At the same time, Europe's and America's cultural influence is waning. China's Xinhua state news agency now has 28 offices in Africa, more than any Western competitor. The state television broadcaster CCTV, which opened a new headquarters in Nairobi last year, is gaining more and more viewers. Instead of airing the usual disaster reports, the station tends to broadcast "good news" from Africa and portrays China as a "true friend."

Nevertheless, there is growing resentment in South Africa, where there are reportedly already 250,000 Chinese. In the townships, the new immigrants are berated as "yellow masters." Among South Africans, the Chinese are often seen as greedy, ruthless and racist, as people who are exploiting Africa, flooding its markets with cheap products and ruining an already weak domestic industry.

Union leaders in Angola complain that Chinese companies are creating too few jobs for local workers. There are rumors in the capital, Luanda, that the Chinese are using prisoners as forced laborers on construction sites.

In Zambia, there are frequent protests against the starvation wages and inhuman working conditions in Chinese-run coal and copper mines. Chinese guards have repeatedly fired on striking miners in recent years, causing bloodbaths. One of the miners, after being struck by a bullet in July 2006, said: "They simply don't see us as human beings." Angry workers killed a Chinese manager during a wage dispute in August 2012.

In Zimbabwe, Chinese products are called ''zhing-zhong'', or junk products that don't last. Chinese vendors were recently attacked in the Kariakoo market in Dar es Salaam.
The most recent Africa Progress Report serves as a warning to the African governments. In it, a panel headed by former UN Secretary-General Kofi Annan concludes that Africa would lose about $38 billion a year due to non-transparent natural resource deals and tax avoidance, a loss far greater than the development aid it receives.

In the current boom, which is primarily driven by China's offensive, the old asymmetry is still in place: Africa remains a supplier of natural resources, while added-value creation occurs somewhere else. A small clique gets rich, while the masses remain poor. That's the curse of the natural resource bonanza. This is what I would like to call: China's Capitalism in Africa.

Thursday, 17 April 2014

Africa was once a diplomatic battleground for both China and Taiwan. But since China’s successful push to curtail Taiwan’s diplomatic influence in the region, those days seem long gone.

China’s going-out engagement is helping shape the future of a resurgent continent. As Africa’s biggest trading partner and creditor, China has become one of Africa’s major economic influences. More than a million Chinese have moved to Africa over the last decade devoted to growth and expansion.

Railway projects in Kenya, to the construction of the African Union in Addis Ababa, new schools and hospitals in Angola, and energy extraction operations in Tanzania, China’s burgeoning presence can be felt all across the continent. Given China’s visible economic impact and the extraordinary opportunities they are bringing with them to enhance employment, technology, and infrastructure, abandoning Taiwan is an increasingly enticing prospect for many African countries.

Taiwan is not widely recognized as independent state and its international situation is becoming dire.Given Gambia's recent announcement of breaking off diplomatic ties, Taiwan's increasing marginalization in Africa is a great cause of concern. The last country to break ties with Taiwan was another African nation, Malawi in 2008. There are only a few African countries that still recognize a self-ruled Taiwan: Swaziland, Burkina Faso, and Sáo Tomé and Principle.

Interestingly, Gambia isn’t the only African nation that has recently announced a change in its diplomatic relationship with China. São Tomé and Principe is collaborating with China to open a trade mission to promote a new cooperation deal, 16 years after relations were broken off between the two nations. Prime minister Gabriel Arcanjo Ferreira assured its ally that it would not affect the country’s relationship with Taiwan but there is still widespread speculation.

Burkina Faso, Swaziland, and São Tomé and Principe might not be the kind of allies a democratic Taiwan would hope for, but the isolated island doesn’t have the leverage to be selective. The majority of Taiwan’s remaining 22 allies are located in the Global South. Taiwan needs to maintain its three allies in Africa, so not to affect the development of cross-strait relations and Beijing’s push to reunify the country.

Taiwan has provided substantial support to maintain ties with its allies. São Tomé and Principe and Taiwan enjoy bilateral cooperation projects in various industries as well as programs to fight malaria. In Burkina Faso, Taiwan is a major stakeholder in their cotton export industry, and also provides millions in foreign aid annually. In Swaziland, Taiwan’s development projects and investments over time have been estimated at roughly US $90 million.

It’s practically impossible for Taiwan’s 23 million people to engage with China in dollar diplomacy to retain its diplomatic allies. But Taiwan might not have to. The question how Taiwan stays afloat still largely relies on how China’s narrative unfolds in the region.

Chinese companies have pumped billions into Africa but it hasn’t always been a win-win situation. In Zambia, we saw corruption and labor abuses as part of the government’s lucrative deals with Chinese managers. President Michael Sata won elections in 2011 in large part because of anti-Chinese sentiment in the country. It also spread to other segments of the continent. Africans have also complained of the unequal trade imbalance, Chinese control of local African industries, and a growing sentiment that China is only in the region to exploit resources.

Chinese managers and workers in today’s African colonies evoke memories of cantonments of British colonial India. If China can’t properly mend its image as an impending imperialist presence in the region, Taiwan’s few yet important remaining allies will reaffirm their ties with the small island.

China’s relationship with African nations is not set in stone. Like all relationships, they can either strengthen or falter. Africa is not China’s exclusive region just yet.

Wednesday, 16 April 2014

Socio-economic inequalities in Europe are greater today than in the 1980s. They have been further amplified by the destructive austerity policies imposed in response to the crisis: five years of economic, banking and unemployment crises, fuelled by irresponsible austerity policies, have led to the deterioration of living standards for millions of Europeans.

The crisis in Europe has further increased inequalities and hit the most vulnerable hardest. Conservative governments across Europe continue to turn a blind eye to the growing divisions in society, despite the shocking realities. In Greece, infant mortality is up 43% because of dramatic cuts to healthcare services. In Spain, over 400,000 families have been evicted from their homes. Youth unemployment affects a quarter of young Europeans on average and in some countries, like Greece and Spain, half of young people are unable to find work.

The gender pay gap stand at a depressing 16.4%, with further deteriorations in women’s pay in several countries in recent years. Spending on education has effectively dropped in over 20 countries of the European Union. Without adequate education and training and with few decent jobs available, opportunities are sadly limited on the world’s richest continent. Employment is becoming increasingly unstable; short-term and part-time contracts, temping agencies and low wages have undermined the job security of many Europeans.

Inequality is the number one challenge of the 21st century. To get out of the crisis, the kind of unbalanced, feeble recovery some countries have shown is not enough. Genuine change will require the creation of jobs with decent salaries, the wider availability of education and training and much greater upward social mobility. To this end, investment in growth and job creation is essential.

Public investment in sustainable jobs, to revitalise growth, industry and domestic demand, is key to bridging the widening gap. It is the combination of equal access to equal public services – notably healthcare and education – and decent jobs with opportunities for upward social mobility that can effectively reduce inequalities.

Looking to the US, Obama has made a clear commitment to fighting inequalities in America by lifting the minimum wage, by removing socio-economic barriers, by facilitating access to education and by creating jobs with decent pay. This is good news for the US and for the world, but Europe has to make sure it doesn’t lag behind the US.

Europe must lead the fight for equality. Suffocating austerity measures hitting the poorest and the Troikas’ short-sighted excesses have exacerbated inequalities. A long-term investment strategy for sustainable, high-tech and research-based jobs, as well as modern industry and manufacturing, will reduce inequalities and return Europe to its global leadership role.

After the European Parliament elections in May, fighting inequalities will have to be the central issue in all policies brought in by the new European Parliament and European Commission. Europe’s social model of welfare will no longer be sustainable if a majority of citizens can barely scrape by and have no security or opportunity instead of contributing to the welfare pots. Millions of new jobs – stable jobs with decent pay – are needed, to give people hope and opportunities, especially for Europe’s young people.

Yet the issue of inequalities cannot be reduced to socio-economic barriers, they occur elsewhere in society, too. The fundamental principles of the European project are based on the premise of opportunity. Free movement, a single market and guarantees for the rule of law and non-discrimination are pillars of an equal society.

Yet these pillars can no longer be taken for granted. Free movement is constantly attacked with xenophobia and accusations of ‘benefit tourism’ against those who seek to build lives elsewhere outside their own country. In reality, only 2.7% of Europeans live in an EU country where they are not citizens and the overwhelming majority of these contribute more and take less from the social security systems of their new home countries than its citizens do. Equality as a form of non-discrimination is under attack, with minorities, especially the Roma community and LGBTI people, regularly facing blatant discrimination. Race, ethnicity, gender and sexual orientation still matter when they should not.

It is the European Union’s duty to address these inequalities wherever they occur and to lay the ground for national legislators to implement policies that foster equality and social justice. If the recovery is focused on guaranteeing social justice, investment in growth and job creation can help reduce socio-economic inequalities. But beyond that, the European Union must rekindle the public’s sense that fairness is a value worth defending in our society.

Equality must be at the heart of every European policy – be it completing the banking union, protecting small savers, investment policy, creating decent jobs, protecting the environment and consumers, or ensuring the safety of European citizens.

The Socialists and Democrats are aware of the difference. Fighting for fairness means fighting for all Europeans. After the last five years of crippling conservative austerity which has divided Europeans and deepened the inequalities in our society, it is time to bring equality and opportunity back to the centre of EU policymaking.

In the European Parliament elections in May 2014, 350 million voters will have a chance to have their say on Europe’s future. We know that we want this future to be one of equality and fairness.

Tuesday, 15 April 2014

President Barack Obama told Russian President Vladimir Putin in a "frank and direct" phone call, (a diplomatic construction that usually means tense), on Monday that Moscow would face further costs for its actions in Ukraine and should use its influence to get separatists in the country to stand down.
Obama said Russian troops needed to withdraw from Ukraine's border to defuse tensions and made a point of praising Kiev for its "remarkable restraint" and efforts to unify the country with elections, constitutional reform and proposals to decentralize power to local governments.

The Kremlin said Putin told Obama during the call that Russia was not interfering in Ukraine and urged Washington to use its influence to prevent bloodshed. Earlier, U.S. officials stopped short of announcing a new set of sanctions against Russia but said they were in consultations with European partners about the prospect. The European Union agreed on Monday to step up sanctions against Moscow by expanding a list of people subjected to asset freezes and visa bans.

Earlier this month, Barack Obama had labeled Russia a "regional power" that is acting out of weakness rather than strength. That may be so. But the US president's own foreign policy legacy depends heavily on Vladimir Putin -- and Europe.

Barack Obama is has a reputation for extreme rationality -- or for being coldly calculating, depending on the viewpoint. Self-control is paramount, and he rarely loses it. One can assume, then, that Obama's barbed comments on Russia, were designed to provoke. They also show just how vexed the US president is by Russian President Vladimir Putin's exploits in Crimea.

It would be difficult to prove the US president wrong. Russian power is certainly not what it used to be and its expansionary tendencies are largely a reaction to the weak geopolitical position in which it finds itself. And it certainly does not represent a direct threat to the US: An invasion of Alaska seems unlikely and a nuclear attack is out of the question. But indirectly, Russia does present a grave danger -- to Obama himself. Putin is threatening Obama's credibility as the leader and guarantor of the West.

From the very beginning of his presidency, Obama has been more focused on consolidating US forces rather than embarking on new international adventures. He has significantly reduced America's military footprint overseas, vocally demanded more help from US allies, emphasized the need for multilateral conflict solutions and preferred to focus on domestic issues as much as possible. Obama's retrenchment largely reflects the desires of the American electorate after eight years of George W. Bush.

What does it mean for the current crisis, though? Does his cautious approach to foreign policy automatically mean he is a weak president? And was it a factor in Putin's decision to act in Crimea?
No matter how Obama views Russia, the Ukraine crisis and how he chooses to confront Putin will be decisive for his foreign policy legacy. That he ended the wars in Iraq and Afghanistan is certainly worthy of praise. But a triumph of his own making remains to be seen.

For any president engaged in retrenchment, policy success is not measured simply by how well the United States extricates itself from old involvements. The decisive question is: "How well are new challenges handled?" There are plenty of them: the conflict with Iran over its nuclear program, the civil war in Syria, a budding military dictatorship in Egypt, China's more aggressive stance toward US allies in Asia -- and now Putin's Russia. The limits to Obama's power are being tested across the globe. And almost all autocrats present America as the enemy as a way of stabilizing their own power.
Republican hawks have long since begun joking about Obama's allegedly naïve attempt to "reset" US relations with Russia. His predecessor George W. Bush, a man who was driven by obsessions in much the same way that Putin is, is now being celebrated as a strong president, although he wasn't even able to apply sanctions comparable to the current ones in response to Russia's conflict with Georgia in 2008.

But Obama's mistake is that he underestimated the revanchist nature of Putin's foreign policy. The Russian president is much less interested in cooperation with the West than he is in constructing an alternative to the West.

The situation is a challenging one. But it is a fateful one for both Obama and the future of US foreign policy. How he navigates it will determine whether he, the retrenchment president, will go down in history as a strong or a weak president, and will inform the policies of those that come after him.

Much is dependent European leaders; such appears to be the consensus in Washington. Will the EU and US show unity and a willingness to accept potential economic burdens that may result from their response to Russia? Or will the trans-Atlantic relationship suffer anew? In short, Europe's path will have a decisive impact on the future foreign policy course charted by the world's last remaining superpower. Obama's legacy hangs in the balance.

Monday, 14 April 2014

The nuclear debate is entering a new phase. Despite the anti-nuclear sentiment that swept the world after the disaster at Japan’s Fukushima plant in March 2011, some major energy-consuming governments are now pushing for the revival of the nuclear agenda.

But it is too early to start celebrating the onset of the nuclear age. The share of nuclear in world power generation has increased but its share in the global primary energy consumption remains modest. And despite renewed enthusiasm, the contribution of nuclear power is likely to remain in line with the trend of the last 50 years.

The Fukushima disaster marked a serious setback for nuclear power. According to the BP Statistical Review of World Energy (2013), 2012 saw the biggest decline in nuclear energy ever. The share of global nuclear output in primary energy consumption fell to 4.5 per cent, the lowest since 1984.
The German government announced that it would opt out of nuclear altogether by 2022.

In Japan, the near-complete shut-down of 50 nuclear reactors accounted for 82 per cent of lost nuclear production in 2012. Japan dropped from being the sixth largest user of nuclear power (after the US, France, Russia, South Korea and Germany) before the accident, to 18th afterwards.

But in sharp contrast to its predecessor, which even considered phasing out nuclear power by 2040, the current Japanese government of Shinzo Abe has injected some optimism into the nuclear industry.
Japan is finalising a new energy policy which designates atomic power as an important long-term electricity source.

Japan imports around 84 per cent of its energy needs – mostly fossil fuels. And the bill has become increasingly burdensome. In 2012, while the US enjoyed gas prices below US$3/MBTU, Japan was buying LNG for almost US$17/MBTU, as demand increased to replace nuclear power.

Meanwhile, in Europe, the UK government reached an agreement with French EDF to build a new nuclear power plant – Hinkley Point C (HPC) – the first in 20 years. HPC is expected to start production in 2023, providing around seven per cent of the country’s electricity needs. Poland, too, is planning to build its first nuclear power plants, to start operation by 2035.

Currently, the production of nuclear power is concentrated in two countries - the US and France account for around 50 per cent of world production. That is gradually changing as more countries add nuclear power to their energy mix. In 2013, there were 31 countries producing nuclear energy compared with 15 in 1973. Globally, more than 66 new power plants are expected to be built or are under construction.

The share of nuclear in world power generation increased from 3.3 per cent to 11.7 per cent between 1973 and 2011. The contribution of nuclear energy, however, is limited to the electricity sector. The US, which is the largest producer of nuclear power, generates around 19.7 per cent of its electricity from nuclear, which in turn constitutes just over eight per cent of the total primary mix. Public acceptance has been one of the main handicaps to the expansion of nuclear energy. While large-scale nuclear accidents are few, they are not easily forgotten.

The other deterrent is a web of strict and detailed regulations which increase the uncertainty of projects as they result in higher costs, delay construction, and can even lead to cancellation.
Nuclear energy competes with all other sources of energy – both fossil fuels (mainly coal and gas, and less so oil), and renewables (hydro, solar, wind and geothermal) in power generation.
Fossil fuels continue to dominate the power sector, with a total share of 68 per cent.

The shale revolution has encouraged power plants in the US to shift from coal to gas, which has become cheap and plentiful, while the opposite happened in Europe because of the availability of cheap coal.

Renewable sources of energy are also rapidly gaining popularity. According to the International Energy Agency (IEA, 2013), between 2008 and 2013, half the world's added electrical generating capacity has been renewable. Three of the world’s four largest economies (Germany, Japan, China), are running their economies with a higher share of renewables than of nuclear. This trend is likely to continue.

The nuclear debate seems to go through the same cycle: from pro-nuclear to anti-nuclear then back to pro and so on, thereby restricting the contribution that nuclear can make to world energy.

Friday, 11 April 2014

The OECD has estimated that developing countries lose an estimated 3 times more to tax havens than they receive in foreign aid each year. This is the “ugliest chapter in global economic affairs since slavery”.

If you read this article very quickly, only another 28 children will have died from hunger by the time you have finished. Developing countries lack the public resources that would provide the nutrition, healthcare and education to lift people out of poverty.

Although public opinion perceives that localised corruption in developing countries is the key cause of global poverty, sixty tax havens and the banking sectors of London and New York have much more to account for. While the World Bank estimates that corruption by government officials costs developing countries a significant US$30 billion a year – this is only 3% of the US$900 billion of public funds lost through tax evasion schemes and other illicit practices by multinational companies.

The primary way which money flows out of these countries is through transfer mis-pricing. In its simplest form this entails three steps:
Firstly, a corporation working in a developing country sets up a subsidiary in a tax haven. Secondly, they sell their product at an artificially low price to this subsidiary – enabling them to declare minimal profits and consequently pay very little tax to the government of the developing country. Thirdly, their subsidiary in the tax haven sells the product at the market price – for comparatively huge profits coupled with a low tax rate (or none at all). In other words, corporations are manipulating prices to pay minimal taxes. This practice is estimated to account for 60% of capital flight from Africa.

For instance, state-owned mines in the Democratic Republic of Congo (DRC) were sold to anonymous “shell” companies in the Virgin Islands for an exceptionally low price – only to then be sold on at their market price to major listed companies. Such deals cost the DRC US$1.35 billion, which is twice the education and health budget of a country where 71.3% of the population currently lives below the poverty line. The shell companies’ owners who benefitted from these dubious transactions remain hidden.

While banks play a critical role in the global economy and many countries’ tax systems, many have also played a significant part in facilitating tax avoidance schemes. ActionAid has recently launched a “Clean-up Barclays Campaign” due to their promotion of tax havens in Africa.

Barclays, the largest UK bank in Africa, channels some of its business through tax havens, enabling its clients to avoid tax and consequently deprive poor countries of vital resources. In 2012, 471 of their subsidiaries were listed in tax havens.

ActionAid has two key concerns about Barclays’ practices:
The first is that their Offshore Corporate division is encouraging investors in Africa to use Barclays in order to benefit from the low tax offshore jurisdictions used by the bank. The second is that the bank’s advertising campaigns in Africa are aggressively promoting the benefits of establishing a subsidiary in the tax haven of Mauritius; as a way of channelling investment into Africa through a “favourable local tax regime”.

Tax avoidance schemes used by corporations can lead to situations such as that of Marta Luttgrodt, who was profiled by both the Guardian and ActionAid. Marta, a small scale businesswoman in Ghana who runs a beer and food stall, pays more tax than Accra Brewery – a member of SABMiller, which had profits of US$5.6 billion in 2012. Many SABMiller companies, particularly in Ghana and India, operate nearly tax-free because of their use of tax havens.

It is increasingly difficult for under-resourced African revenue authorities to track profits and tax liabilities through a maze of shell companies, holding companies and offshore entities used by investors. Foreign direct investment, instead of acting as a catalyst for development, can harm long-term social and economic prospects – particularly when corporations are reaping developing countries’ resources without giving the government its deserved tax revenue.

The UK Independent Party nationalist pleas to UK the government to “stop giving foreign aid” seem misplaced when one considers these statistics. The fact is that flows from poor to rich countries vastly exceed those from rich to poor. The OECD has estimated that developing countries lose an estimated 3 times more to tax havens than they receive in foreign aid each year. Rather than cuts to overseas aid, what is necessary is a change of policy towards tax evasion. If poor countries can’t reap the multi-billion dollar benefits of their countries’ copper, diamonds, bauxite, oil and so on, then how will they stop needing foreign aid?”

Companies can no longer use the “letter of the law” to avoid paying tax. It is the spirit of the law that matters, and laws are rarely made with the intention of helping corporations evade tax. Western governments need to effectively monitor and enforce companies so that they abide by the spirit of the law and pay the correct tax rates in every country in which they operate.

The public and government should support Action Aid’s call for Barclays to eliminate all activities in tax havens that do not support the real economic substance of its customers’ businesses. They should also be urged to publish details of profits, turnover, staff numbers/costs and numbers of clients, broken down by onshore and offshore activity for each subsidiary and permanent establishment, in each remaining tax haven.

Tax-related capital flight is a problem all over the world. Western governments have a substantial influence over corporations operating in developing countries – and a duty to help people living in poverty benefit from the tax revenues their government should be receiving.

If the money lost to tax evasion was available for governments to allocate, according to current spending patterns; the amount going towards health services could save 1.9 million children a year. That’s 21 fewer children dying in the time it took you to read this article.

The Ukraine crisis has caught NATO flat-footed as it rushes to find an adequate response to Russia.The alliance's cooperation with Russia -- which took years to build up -- has been on ice since last week. And Moscow is no longer seen as a partner, but as an adversary.

NATO says tens of thousands of Russian troops are massed on the border with Ukraine for a potential invasion, yet Western states still lack a strategy to stop Moscow from intervening in its former Soviet neighbours.

Prior to the Ukraine crisis, there were many asking what purpose NATO would serve once the alliance's troops had withdrawn from Afghanistan. But now that Putin has taken over the Crimea -- leading countries on the alliance's eastern edge to feel threatened -- the mood in NATO's Brussels headquarters has changed dramatically. General Secretary Rasmussen, one NATO source said, has "positively blossomed." And the US, Britain and most Eastern European member states support him.

The new debate within NATO is no doubt music to the ears of aging cold warriors who have always felt that integrating Moscow into alliance structures was dangerously naive. But it is also the logical consequence of a reconsideration of Russian President Vladimir Putin's long-term goals. If Russia is now planning its future against the West rather than with the West, then the question regarding of ''how to deal with Putin'' must be posed.

With military action to protect non-NATO states effectively ruled out, current and former officials say sanctions and isolation provide the best - and perhaps only - way to pressure Moscow. Ramping up the pressure on the rich and powerful around President Vladimir Putin, they say, might in time push him towards a much more conciliatory approach.

But that, they concede, could prove a long game, and some both in and outside government worry that a more isolated Russia may simply become both more nationalist and self-sufficient. Putting Putin under more pressure, they worry, may give him even more incentive to take a populist, more aggressive approach.

Yet there is certainly a military aspect to the issue. Already, Ukraine has sent a request to NATO headquarters for the delivery of radios, weapons and munitions from alliance stores. And NATO has asked alliance members to make additional contributions over and above the already agreed to increase to air-policing sorties and AWACS surveillance flights. Proposals are to be submitted to NATO headquarters by mid-April.

Poland, for its part, would like to see even more shows of NATO solidarity. Not to put too fine a point on it, Poland is afraid of Russia, as are its Baltic neighbors. Some of that fear stems from the Soviet era. But Russia's recent show of power on Ukraine's eastern border -- and Putin's evident refusal to withdraw forces as he recently promised -- has also raised concern in Warsaw.

The West long snickered at the dilapidated state of Russia's military. But it has since been dramatically modernized and analysts in Western armies and intelligence services are concerned about the capabilities Russia has put on display in recent maneuvers.

''Operation Sapad 2013'' is a particularly stark example: Sapad is the Russian word for West and the exercise could certainly be understood as a threat pointed in that direction. Officially, fewer than 13,000 soldiers took part in the exercise, falling below the threshold that would have required observation by the Organization for Security and Cooperation in Europe (OSCE). But part of the exercise took place in Kaliningrad, the Russian exclave on the Baltic Sea that shares borders with Poland and Lithuania. Special forces were involved as were officers from the FSB, Russia's domestic intelligence agency.

In total, Western military leaders estimate, some 60,000 people took part in the maneuver -- one which even interfered with a NATO radar facility in the Baltics. The Russian military also fired a short-range "Iskander" missile. It was armed with nothing more than a practice warhead, but drills for arming such missiles with nuclear warheads were also apparently carried out.

It is clear what the Russians showed the West/NATO with the maneuver: They can escalate a conflict on their western border and then contain it again. Nobody doubts today that Russia would be able to overrun and occupy eastern Ukraine.

What is happening in the region is that Russia is successfully imposing new demarcation lines between what it considers its own sphere of influence and the West. These lines could delineate the new post–Cold War borders.

In effect, the region east of NATO could become Russia’s glacis, a playground for Moscow to make land grabs. That’s what Russia has done in Crimea as well as in the Georgian provinces of Abkhazia and South Ossetia. Russia’s next step could be to consolidate its grip over Moldova’s breakaway region of Transnistria.

Wednesday, 9 April 2014

With a stagnant economy, continued political uncertainty, and a terrorist problem, Tunisia encapsulates the problems that have emerged from the uprisings of three years ago. Whatever happens in Tunisia, however, will not stay in Tunisia; and so it behooves Washington and Tunis—as they launch their Strategic Dialogue last week—to seek the best possible outcome together.

A UN report, released in March, revealed that Tunisian authorities have seized “Libyan MANPADS and other short range surface to air missiles” smuggled across the border from Libya. As battle-hardened jihadists from across North Africa return from Syria, Tunisia and its neighbors alike face serious peril from terrorism. While the Tunisian government has shown greater resolve in recent months, the country simply does not have the capacity to handle the problem alone. It needs assistance from friends in order to upgrade its forces and effectively monitor jihadist activities on its border and beyond.

That was the reason why, on April 4th, Tunisian Prime Minister Mehdi Jomaa, who took office in December, visited Washington. He sought seek greater US support to his country, the birthplace of the Arab Spring, as it strives to combat terrorism and salvage the economy.

In February, US Secretary of State John Kerry described Tunisia as a country “that has an opportunity to show the path, to point the way,” for Arab Spring nations engulfed in turmoil. His words were justified. About 10 percent of Libyans have taken refuge in Tunisia. Whereas political violence continues in Egypt, Libya, and, of course, Syria, Tunisia’s vying factions were able to reach a compromise enabling ratification of a progressive constitution and the appointment of a technocratic government. Free and free elections should be held by the end of the year.

Nothing is certain, however. Prime Minister Jomaa continues to face daunting socioeconomic challenges. Tunisia’s youth still yearn for greater job opportunities and better living standards, three years since the fall of the Ben Ali regime.

In recent weeks, the Jomaa was quite open with the Tunisian public on the extent of the country’s economic plight. Bloated government spending has led to mounting debt and a soaring national deficit. Sooner or later, Tunisian governments will have to introduce the kind of fundamental economic reform that can spur growth and employment. But cutting subsidies and freezing salaries will be difficult before elections.

Most Tunisians are aware that many post-revolutionary wounds were self-inflicted. Political polarization, identity wars, and score-settling campaigns took a terrible toll and did not leave much time for interim governments to fix the economy. Ideological hang-ups and government inexperience helped enable forces of terror and extremism. Today, politicians still have to work hard at reconciliation and inclusive democracy. They seem however to be exorcizing their destructive demons and changing their focus to the future.

Tunisia needs help. It has been nearly three years since the Group of Eight promised $20 billion in aid to the Arab Spring countries, including Tunisia, to foster democratic transition and economic reform. But they have not fulfilled their pledge.

Achieving the type of “post–Berlin Wall” transformation to which the G8 alluded to at the 2011 Deauville summit would have required granting Arab Spring countries the same kind of support received by newly liberated East European nations. In recent weeks, Ukraine has received $27 billion in aid pledges from the international financial institutions, Europe, and the US. Tunisians may be forgiven for wondering whether only Europeans are eligible for the kind of transformational help their country needs.

Tunisia could become the driving engine for democracy and economic growth south of the Mediterranean. Successfully completing the transition would not only help Tunisia, but also mitigate corrosive instability and radicalization whose reverberations might be felt far and wide. Tunisians expect the international community to be more forthcoming with them in the current juncture.

Tuesday, 8 April 2014

This week Rwanda marked 20 years since the genocide that killed 800,000 people in just over three months, President Paul Kagamé reiterated his conviction that France was partly to blame for the slaughter, saying bluntly in French that "facts are facts". ( Les faits sont têtus).

Rwandan President, Paul Kagamé directly accused France to have played a "direct role" in the killings and said that French soldiers – who helped train the Hutu nationalist-controlled Rwandan army prior to 1994 – had been both accomplices and “actors” in the bloody tragedy. "Twenty years later, the only thing you can say against them (the French) in their eyes is they didn't do enough to save lives during the genocide," he continued.

His accusations against France can be justified but also they fail to address objectively the political causes of the genocide that took place 20 years ago.

On April 6, 1994 at 8:20 p.m., a plane carrying Rwandan President Juvénal Habyarimana, a French government puppet, was shot down as it approached the airport in the capital Kigali. The circumstances of the incident remain a mystery to this day. But the apparent assassination marked the beginning of the genocide.

That same night, the presidential guard and Interahamwe militias ("fighting together" in the official Rwandan language Kinyarwanda) went on a murderous and incendiary rampage through the streets of Kigali. A group of fanatical Hutu had seized power and decided to wipe out the Tutsi minority, which made up about 10 percent of the population, once and for all. The violence swept across the entire country within a week.

During the next 100 days, the Hutu regime and its accomplices murdered some 800,000 Tutsi and moderate Hutu -- the equivalent of five killings a minute. It is likely that never before in human history had so many perpetrators murdered so many people in such a short period of time. I am not exaggerating by characterizing it as an "African Holocaust."

The genocide, one of history’s worst and certainly its quickest, finally ended in July, when the Rwandan Patriotic Front seized control of the country. The rebel army was led by a 36-year-old Tutsi former refugee named Paul Kagame, who promptly took political control: serving first as the de facto leader of the country while defense minister and vice president and then, in 2000, assuming the presidency. During Kagame’s two-decade rule, Rwanda has made spectacular progress.

In April, 6, 1994, a plane carrying Rwandan President Juvénal Habyarimana was shot down by ''Tutsi'' U.S. trained rebels stationed in Uganda. Hutus had seized power and decided to wipe out the Tutsi. They pursued a simple logic of extermination: If we don't wipe out them, the Tutsi, they will destroy us, the Hutu.

As Hutu extremists went on a murderous rampage following Habyarimana’s assassination, killing minority Tutsis and moderate Hutus, a Tutsi rebel force, the RPF (Rwandan Patriotic Front) took advantage of the social disorder and managed to sweep through the country. By July 1994, the RPF – led by Paul Kagame – had taken Kigali, sending Hutu forces fleeing east toward Zaire.

In this fog of war, France stepped in to protect ''Tutsi'' in a military operation dubbed: '' Opération Turquoise'' under a UN mandate. The launch of the French Operation Turquoise was controversial since the UN already had a peacekeeping force, the United Nations Assistance Mission for Rwanda (UNAMIR) in Kigali.

The Rwanda's genocide was borne out by the geopolitical agenda of the superpowers: U.S/UK and France/Belgium. Rwandan President can rightly accuse France's direct role in the massacre, however his accusations do not make him a saint either.

The first TV images appearing around the world during those initial days were so monstrous and inconceivable that commentators referred to the slaughter as an "aberration of nature," a murderous frenzy, a "maladie de tuer," or "killing sickness" -- as if the genocide had descended on Rwanda like an insidious virus.

The murderous excesses had nothing at all to do with "tribal warfare." The Hutu and the Tutsi have shared language, customs and culture for centuries. There were mixed marriages, and many Rwandans were unable to tell whether someone was Hutu or Tutsi. The causes of the tragedy were to be found elsewhere: the geopolitical agenda of superpowers in action in Africa.

Today we know that the genocide was not the work of archaic, chaotic powers, but of an educated, modern elite that availed itself of all the tools of a highly organized states: the military and the police, the intelligence services and militias, the government bureaucracy, the mass media and the geopolitical agenda of the U.S. and United Kingdom in central African region.

Twenty years after the genocide, Rwanda, a country famously deemed “nonviable” in the mid-1990s has become one of Africa’s best-run, most orderly, least corrupt, and safest states, with a booming economy (Rwanda’s GDP has grown by an average of eight percent in recent years). But Rwanda’s success has come with a darker side: opposition politicians have been jailed or killed under mysterious circumstances, journalists complain of harassment, and Kigali has been regularly criticized for meddling in neighboring Congo’s long-running civil war.

The current government is doing exactly the same thing that the then Rwandan government was doing - rigging elections and imprisoning voices of opposition. The lack of freedom and democracy is why, the Rwandan Patriotic Front, rose up and finally revolted against a regime that was oppressive and was not willing to listen.

As Rwanda is moving forward towards a permanent reconciliation, 20 years after the genocide, Rwandan political leaders must learn from the past mistakes of others. ''Those who do not learn history are doomed to repeat it.'' Over our history, wars ended with confiscatory terms of surrender inevitably breed more wars. Revolutions that give an individual absolute power inevitably end up as brutal dictatorships.

Monday, 7 April 2014

When Brazil opened up its huge offshore petroleum discoveries to foreign developers in last October, after holding off on a decision for six years, government leaks indicated that Chinese state oil companies would dominate the bidding for the estimated reserve of eight to twelve billion barrels of oil.

When the bids were opened, however, the Chinese proved to be far more cautious than expected and took only a minority participation in the winning consortium dominated by Petrobras, the Brazilian state oil company, and two major Western multinationals, Royal Dutch Shell, the Anglo-Dutch giant, and Total, the largest French oil company.

The deal secured Chinese financing for twenty percent of the $180 billion needed to develop Libra, the largest oil and gas field ever found in Brazil, and retained for Brazil sixty-six percent of Libra’s oil production, which is estimated to reach a peak of 1.4 million barrels a day in ten years. This landmark deal showed that while China, and its government-run companies, will expand its global search for secure sources of oil in Latin America whenever opportunities arise, the Chinese are also exercising caution in investing in foreign lands where oil involves high political, as well as economic, risks.

In general, China has made a significant effort to be seen as a good partner in Latin American development, not a threatening outsider using its leverage to beat down the price of the natural resources it procures. This policy puts China into a soft-power role of providing financing for structural investments that improve infrastructure and expand energy sources. And it is part of a hemispheric policy. Chinese lending for development projects in Latin America since 2010 has been greater than the combined loans of the World Bank Group, the Inter-American Development Bank, and the Export-Import Bank of the United States. The $20 billion annual direct investment by Chinese companies in Latin America plays well politically.

China’s relentless quest for oil, minerals, and food is creating a geopolitical bond between Latin America and China that establishes the Asian giant as a powerful new presence in a region that has traditionally been more closely related to the United States and Western Europe. This is part of the new global dynamic in trade and investment that is reshaping world power relations. The meteoric rise of China’s trade with the world brought about a ten-fold increase in commercial exchanges with Latin America in little more than a decade.

Initially, the expansion was driven by China’s strategy of flooding world markets with cheap Chinese manufactures—an effort that later included Chinese automobiles, machine tools, and electronic and communications devices. This strategy initially produced large trade deficits in favor of China, but in a short time the trade relationship became balanced as China made a point of increasing imports of commodities produced in Latin America to pave what has become a two-way street.

By 2012, total trade had reached $260 billion, with Chinese exports of about $135 billion being almost matched by about $125 billion in Latin American exports to China. Brazil, by far Latin America’s largest country, traded $85 billion with China, and Mexico, the other economic powerhouse, added $42 billion to the total exchange. Many of the other thirty-two countries in Latin America are small Caribbean islands or underdeveloped economies that have little to export to China.

Most of the big traders have oil or metals as the basis for their trade with China, and a select few, mainly Brazil and Argentina, provide the agricultural products that totaled $28 billion in exports to China in 2012. There is a high level of synergy between the Chinese need for imported food, mainly soybeans and animal proteins like chicken and beef, and the fast-growing potential for increased production in the heartland of South America.

It is no surprise, therefore, that the Chinese are making major investments in Latin America to promote land productivity and improved logistics to transport agricultural cargoes to China. This is a strategic relationship because China’s lack of water limits its ability to produce food needed to feed its population of 1.3 billion.

A study of world agriculture by the Organization for Economic Cooperation and Development shows that China, with twenty percent of world population, has only eight percent of the globe’s agricultural land and seven percent of its potable water. This limited capacity is further constrained by the low productivity of China’s three hundred million village farmers. Although China is the world’s largest rice producer, its productivity in soybeans is only half of the production per hectare of Brazil and Argentina, which together now produce and export more soybeans than the United States. For the foreseeable future, China will be heavily dependent on imported foods.

The very rapid expansion of China’s commercial and financial relations with Latin America—a region with which China had virtually no prior contacts—brings new risks as well as high potential rewards.

The Chinese are now the largest international lender to countries like Venezuela and Argentina, which are passing through periods of economic crisis and potential political instability. The situation is particularly sensitive in Venezuela, where China has made advance payments of $30 billion for future oil deliveries from a government that is facing shortages of food, fuel, and energy supplies, as well as rising social protest. China’s decision to continue financial support for the regime after the death of President Hugo Chávez in March 2013 was clearly political.

In exchange for seven hundred thousand barrels a day of cheap oil from Venezuela, China’s loans help to prop up Venezuela’s Cuban-style socialist regime, including the health services provided by Cuban doctors. It is not clear whether China’s appetite for oil also involves an aim to reduce US influence in Latin America. But its involvement in Venezuela, America’s chief antagonist in the region, seems to transcend the merely commercial, and may become a major test of Beijing’s intentions.

When Chinese relations with Latin America began to thicken just ten years ago, there came a rash of books and periodical publications in the West that cast the emerging Asian giant as a threatening dragon. With titles like The Dragon in the Room and Enter the Dragon? China’s Presence in Latin America, some of these publications generated alarm, from a US perspective, over Chinese “intrusion” into what has traditionally been its own geopolitical backyard. This view was balanced, however, by numerous other assessments that argue that China’s expansion has created only economic advantages for Latin America, not peril for the US. From this perspective, China is more like a jolly green giant than a fire-breathing dragon.

When global food security is debated in international forums, it is assumed that food production will have to increase fifty percent by 2050 to meet the demand of a world population growing to nine billion in the coming years. The tropical flatlands of South America and sub-Saharan Africa are considered to be the most promising areas in the world for this growth of production to take place.

Brazil is the outstanding example because of its fortuitous combination of land, water, and climate, and modern farmers who know how to apply the technology of high-yield agriculture created by research in agricultural sciences. China knows this, which is why it is investing in infrastructure in Brazil. Reducing dramatically the cost of shipping food is one objective. Conserving foods that require storage and processing food products to retain nutritional levels and reduce waste are also areas for intensified research. China is well aware that food is much more than just a raw material.

The mining sector is also important for future relations between China and Latin America. As long as world industry demands iron ore for steel mills and non-ferrous metals like copper for electrical wiring and metal alloys, Brazil and the Andean countries along South America’s Pacific coast will be vital for China. Prices may fluctuate with variations in world demand, but high-grade ore bodies in Latin America will continue to provide major sources of foreign income and investments in mining under any scenario.

When China’s annual rate of growth slowed from the breakneck pace of more than twelve percent annually, for instance, some analysts predicted that this would cripple iron ore purchases, with depressive consequences in Brazil. The reaction of Vale, a privately owned company, was to double down on investment in its major mining properties, the world’s largest high-grade iron mine at Carajás, in the Brazilian Amazon state of Pará, and a new coal mine in Mozambique that is also expected to supply China and India.

The expansion of Carajás, which also produces gold, nickel, copper, and niobium, will require an investment by Vale of some $19 billion dollars to increase annual production by ninety million tons by 2018, doubling present output. Where will all this ore go? It will be shipped in supercargo ships, carrying three hundred and fifty thousand tons, from deepwater ports on Brazil’s northeastern coast to China and other Asian ports. This shipping is so efficient in cost that Brazil’s high-grade iron ore can compete with sources in Australia.

In 2000, Vale produced one hundred million tons at various mines but sold only seven million tons to China. After Carajás came onstream and began to export, Brazil’s share of the Chinese market soared to one hundred and fifty million tons. “With the expansion now under way, Vale expects to gain a twenty-percent share of the Chinese market, with another hundred and fifty million tons annually,” said José Carlos Martins, Vale’s executive director for planning. With trading volumes of this scale, commercial relations between China and Brazil can be expected to mature into more long-term investments in many areas, including transportation, local industry supplying mining, agricultural, energy equipment, and even banking.

The China Construction Bank, one of China’s most powerful financial institutions, and the National Bank of China have already opened agencies in Brazil, and the China Development Bank is negotiating with its Brazilian counterpart on joint ventures.

In the latest of a succession of top-level meetings, President Xi Jinping is scheduled to come to Brazil in this month, April, leading a cohort of economic officials and Chinese businessmen who are anxious to expand investments in Brazil. This visit reciprocates a trip to China by President Dilma Rousseff in July, last year, which advanced strategic planning and diplomatic cooperation between the two powerful BRIC partners. Brazilian officials have high expectations that the Chinese are going to move ahead toward a working partnership that will make Brazil the centerpiece of Chinese interests in Latin America.

If the US does not see this expanded Chinese presence as an inconvenience, it is only because the Obama administration does not have an active policy for Latin America. With the Obama administration’s so-called pivot to Asia, it is not clear whether the US considers China as an adversary to be contained, or as a potential partner for cooperation on global issues, such as nuclear nonproliferation, climate change, food security, and poverty reduction in the most impoverished regions.

In either case, the old pan-American concepts on which the US based its special relations with Latin America need to be updated to consider the possibilities of working with new players in the region. And now China is chief among them.

Friday, 4 April 2014

Rarely do local elections anywhere have such profound national resonance. In municipal elections on 30 March, France’s governing Socialist Party (PS) lost more than 150 towns and cities. The centre-right UMP made huge gains, much more than expected. Members of president François Hollande’s party thought they might limit the damage, given that local politics is often very different from national politics, and France has a long and deep tradition of a “municipal socialism” largely insulated from national concerns. Well, not any more.

Town hall after town hall the left had held for decades went to the opposition, and a dozen of them to the far-right Front National. Limoges, a stronghold since 1912, was lost. Many towns run by the left since World War II were lost as well. The scale of the socialists’ defeat is historic – and a humiliating personal defeat for the president, two years into his five-year term. Following on next month are the European elections, now expected to be catastrophic for the governing party.

Even more alarmingly, the local elections saw a '' Vague Bleue'' (Blue Wave) for the centre right, but also a very strong '' Vague Bleue Marine'' (Navy Blue Wave) – a pun on Marine le Pen of the Front National, whose party won 1,500 councillors in an advance just as historic as the centre-right’s. In Hénin-Beaumont, the FN even won outright on the first round a week earlier.

In some places, round two run-offs between rival lists saw no leftist lists on the ballot at all, just UMP, FN, and independent right (divers droites), as if anything left of centre didn’t exist. The Socialists are in a state of shocked disbelief – and now widespread recriminations and in-fighting at local level will make matters even worse.

In an attempt to salvage the situation, the deeply unpopular president has taken drastic action. On Monday 31 March he sacked his prime minister, Jean-Marc Ayrault, and in his place appointed the only popular minister in the government, the former interior minister Manuel Valls. Will it work? There are reasons why it might, and reasons why it might not.

Valls is nationally the most popular figure from the left. In fact, he’s almost the most popular figure on the right too. His style is what people want: tough and decisive on crime and security, and well to the right of the whole of his party on virtually everything else. One of his problems is therefore to manage the left of the party. Two astute appointments to his new cabinet, Benoit Hamon and Arnaud Montebourg, should be seen in this light. Hollande’s ex-partner, former presidential candidate Ségolène Royal, is also back in government.

Though on the right of the party, Valls is also an immigrant son from a modest background ( He was born in Barcelona to a Catalan father and a Swiss mother from the Italian-speaking canton of Ticino, and he only became a French citizen at 20), and was mayor in a deprived area, so knows the lives of ordinary people on the council estates; those who voted FN or didn’t vote at all. Second, a new departure was overdue. Hollande and his government could almost not be less popular. With his new, leaner government, Valls has the opportunity to try to get the economy back on track.

The tasks are clear: balance the books and get public spending down, make French businesses more competitive, and reinvigorate the Franco-German alliance and France’s leadership role in Europe. To keep everyone on board, he has also to address a range of social questions, just as any self-respecting leftist government should, in particular the appalling problems in forgotten suburbs where even the police won’t go.

None of this will be easy. These things should have been addressed two years ago when Hollande was elected. Unemployment is still rising horrendously, the deficit is not going down, and national debt is now 93 per cent of GDP. After two years of virtually no change, apart from taxes going up and up, the economic tasks facing the new government are immense. But perhaps more than anything, Valls has to change the culture and attitudes of the French.

France’s vast army of civil servants work for a state that can't afford them. The added problem for the government is that these middle-class state employees are the PS’s main constituency, since it lost the working class some time ago. France has to become a society where small- and medium-sized firms and start ups are respected and encouraged. That will require a sea change among many myriad vested interests that choke the vitality from French society.

Valls also heralds another fundamental change in French politics. Seemingly without the French having realised it, the events of the last week have turned the Fifth Republic on its head. The prime minister is meant to be a lightning rod, protecting and enhancing the prestige of the president by taking all the flak and unpopularity directed at his government. This has been the case since 1958 – until last Sunday.

The problem now is that Valls is infinitely more popular than Hollande, and if he is a success, Hollande will therefore not profit from it; all the applause will be for Valls, and he will soon look infinitely more presidential than his president boss. If he doesn’t succeed, both men will be regarded as failures. In appointing Valls, Hollande has played a joker.

Thursday, 3 April 2014

Africapitalism is about creating value within Africa for the long-term. It is about transforming the continent in a way that is both profitable and sustainable. It is also a call-to-action for Africans to take primary responsibility for their own development and for non-Africans to evolve their thinking about how best to channel their efforts and investments in the region.

This simple word is all about a power shift that has been long coming. It is about Africans taking responsibility for their home, something that we have not been able to do for a long time.

Africa’s power has always been concentrated among those who best survived the brawl to the top. Once there, the newly-established political elite found it so comfortable that those left behind were forgotten. Then another route to rise emerged – entrepreneurship. It has no bias, no qualms with gender while rewarding hard work. It is finding a way to rebalance the power that has for so long been held by African aristocrats. Best of all, it is real.

Entrepreneurs such as Evans Wandongo, Juliana Rotich and Njideka Harry have stepped up to create change. There was no waiting for aid, pity or lengthy discussions. Another stand-out entrepreneur is Saran Kaba Jones, founder of FACE Africa, a firm that funds and implements sustainable clean water, sanitation and hygiene projects in sub-Saharan Africa utilising local labour, materials and resources.

In a 2005 report by the CATO Institute it was argued that entrepreneurs were facing daunting constraints. They were prevented from creating wealth by predatory political elites that controlled the states. African political elites used marketing boards and taxation to finance their own consumption. Six years later, The Economist published a report on the rising few who influence countries not through politics but through their brains – the innovative.
The likes of Jones, Wandogo, Harry and Rotich have been successful in achieving something that seemed impossible even less than a decade ago.

Why is entrepreneurship so important? That is because it disrupts the status quo and creates new and more efficient ways of achieving goals. Some argue that successful entrepreneurship exacerbates local inequality, but this is not the case with African entrepreneurship. African entrepreneurship is not born of the ordinary capitalists’ goal for superior wealth. It is founded out of necessity.

Jones’ FACE Africa was a product of the Liberian conflict. Its aim is to help others reclaim the means to build a better life and prosper. Similarly, fellow Africans have used the tool of entrepreneurship to reclaim the power taken from their people. Undoubtedly, the result of successful entrepreneurship is sometimes superior wealth, but those who make it to the top create opportunities for others.

One example is the philanthropist Tony Elumelu – founder of Heirs Holding and coiner of the term Africapitalism. His efforts are aimed at re-establishing Africa as an investment opportunity, no longer dependent on aid. Through his foundation, he is also building an army of budding entrepreneurs, improving access to finance for start-ups and providing policy advice for the public sector.

Now the question is how Africans see this change moving forward, whether this tool, entrepreneurship, is truly what it seems.